College of Marin Foundation board members resign amid financial dispute

The future of an independent foundation that supports College of Marin students and programs is uncertain after its board resigned en masse amid investigations of alleged misuse of funds.

In a letter Monday to college President David Wain Coon, all nine College of Marin Foundation board members said they would step down, leaving Coon and Diana Conti, president of the separate college Board of Trustees, to oversee the foundation and the investigations.

Officials from the college and the 48-year-old foundation have been embroiled for months in a financial dispute, which escalated this spring after allegations of misused funds surfaced. In June, the foundation's board agreed to commission an independent financial investigation apart from an audit by the college.

The foundation also agreed to relinquish funds College of Marin officials said had been donated to the college but deposited with the foundation.

However, in Monday's letter — available online — the foundation board members said they would step down because of difficulties working with the college. They said the college continued to demand documents for an audit that were not available, did not exist or were to be released after the foundation's separate investigation.

"Continuing to expend the Foundation's funds without the potential of a good faith partner would be a futile exercise that further depletes funds that are better spent and preserved for the benefit of the College's students," the foundation board stated in the letter.

College officials said they were surprised the board resigned with the financial investigations still ongoing and that their requests for documents such as invoices, contracts and financial statements had been reasonable.

"Unfortunately, the assurances they gave us back in early August or July that they would give us all the information that we needed, they didn't follow through on those assurances," Conti said.

Tensions have been building between the college and the foundation since at least last summer, when the college announced it planned to create its own fundraising arm apart from the foundation, Coon said. "The next (foundation) meeting they had legal counsel at the meeting," he said.

In May, college trustees directed Coon to seek control of $1.8 million in foundation-controlled money after a former foundation bookkeeper and others raised concerns about financial mismanagement.

The allegations included unauthorized spending, missing checks and the possible misuse of restricted funds to cover administrative expenses.

The bookkeeper, Daniel Shiner, was one of several staff members, including former executive director Margaret Elliott, a secretary and a part-time clerk, who have left the foundation in the past year. Elliott also raised financial concerns after her dismissal.

Her replacement, David Eastis, was fired in April and he has sued the foundation over his dismissal in federal district court in San Francisco.

Conti said the college has become increasingly concerned about the foundation's spending on legal expenses and other costs.

"We've been very, very concerned about the overspending, and the amount of overspending we think is probably at least a quarter of a million dollars," she said. "I don't think anybody assumes there is any fraud here. I think there's just very bad management and unfortunate decisions that have had really severe implications."

Vadim Canby, who joined the board a few months ago, said he and his colleagues resigned because it became too difficult to work with the college in handling the financial investigations.

"We tried our darnedest to make things right; the pressure just became too great to withstand and we all decided to resign, basically, to let the college deal with it," he said.

In its letter Monday, the foundation board also said the college, in its effort to take control of $1.8 million in funds, may have intended to disregard donors' wishes of how the money be spent.

"The immediacy of the College's demands simply validates the Foundation's concern that the College simply wants the money with no strings attached," the letter stated, in part.

Coon said the allegation is baseless.

"Our concern all along has been making sure these funds are secured to be able to honor the donors' intent," he said.

Coon and Conti said they would confer with college trustees over how to handle the foundation.